Worst States to Make A Living 2011

MoneyRates.com looked at average wages, cost of living, unemployment rates, and state taxes to calculate the 10 worst states for making a living; see if your state made the list.
Financial Expert
Managing Editor

Also see the most recent Worst States to Make a Living feature

Trying to get ahead financially but just not making headway?  Maybe it’s not what you’re doing, but where you live that’s holding you back. 

While the economy is generally in bad shape, some states have been particularly hard hit.  If you’re considering relocating, you want to make sure you don’t simply trade one bad set of employment conditions for another. Also, what about other factors that will affect your standard of living, such as income levels, cost of living, and state tax rates?

MoneyRates.com has done a comprehensive analysis that takes into account the following factors that affect your ability to make a living:

  • Average state wages
  • State unemployment rate
  • State tax rate
  • State cost of living

Based on these factors, MoneyRates.com calculated an adjusted-average income for each state and ranked states against each other.

Here is the resulting list of the worst ten states for making a living:



10 worst states for making a living


1. Hawaii

 No wonder there’s so much crime on Hawaii Five-0! This is undoubtedly a great place to live for many reasons, but it is a tough place for making a living. An extremely high cost of living, coupled with a fairly high tax rate, give Hawaii the lowest adjusted-average income at $22,107.96. With this adjusted average income, Hawaii residents don’t have much to put into their savings accounts.


2. Maine

A combination of relatively low wages and an above-average cost of living give Maine the second-worst adjusted-average income, at $29,159.19.


3. Montana

 With an adjusted-average income of $29,495.73, Montana makes the list primarily because of the state’s low average wages.


4. California

 This state’s fiscal woes are well-known, and high taxes, high unemployment, and a high cost of living drag its adjusted-average income down to $29,772.40.


5. Vermont

 With an adjusted-average income of $29,985.60, Vermont is only slightly better than California. The state does have a fairly low unemployment rate, but relatively high state taxes and cost of living drag down its ranking.


6. Oregon

 Oregon suffers from an above-average rate of unemployment, and once residents find a job they have to contend with a high cost of living and a high state tax rate. This combination gives Oregon the sixth-worst adjusted-average income in the country, at $30,343.10.

 Rhode Island

7. Rhode Island

 The cost of living, state taxes, and the unemployment rate are all higher than average in Rhode Island. Together, these factors are enough to drag above-average wage levels down to an adjusted-average income of $30,611.87.


8. Mississippi

 The cost of living in Mississippi is cheaper than the average for the country as a whole, but unfortunately, the state’s average wage levels are among the lowest in the country. The latter is enough to put Mississippi into the eight slot on this list, with an adjusted-average income of $30,952.90.

 West Virginia

9. West Virginia

 West Virginia’s characteristics are similar to those of Mississippi – a low cost of living is not enough to make up for very low wage levels in the state. Wages are a little higher in West Virginia than in Mississippi, helping West Virginia’s adjusted-average income to come in at a slightly better level of $31,357.15.

 South Carolina

10. South Carolina

 Rounding out the ten worst states for making a living is South Carolina, which suffers from a combination of below-average wages, above-average state taxes, and above-average unemployment. The cost of living is slightly cheaper than average in South Carolina, but that’s not enough to prevent the state from making this list with an adjusted-average income of $31,636.27.

One of the beauties of living in a large and diverse country is the opportunity to improve your lot by pulling up stakes and relocating somewhere else. This list may help you decide whether your state is unusually challenging for making a living, and if so, which places you might want to avoid if you are thinking of moving to improve your career. 

Or, if you decide to stay put, explore other ways of boosting your income – including moving your money to the best savings accounts, money market accounts and other deposit accounts.

Doing everything right, and still not having success? Take a look at the 10 best states for making a living.

Richard Barrington has been a Senior Financial Analyst for MoneyRates. He has appeared on Fox Business News and NPR, and has been quoted by the Wall Street Journal, the New York Times, USA Today, CNBC and many other publications. Richard has over 30 years of experience in financial services. He has earned the Chartered Financial Analyst (CFA) designation from the Association of Investment Management and Research (now the “CFA Institute”).